Cenvat Credit on outward freight - delivery is on FOR basis - place of removal

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..... Cenvat Credit on outward freight - delivery is on FOR basis - place of removal
Query (Issue) Started By: - chaganti srinivas Dated:- 12-4-2010 Last Reply Date:- 13-4-2010 Central Excise
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Central Excise
Dear Sirs, We are availing service tax credit on outward freight charges based on the terms of Purchase order which were 'FOR destination.'. In one particular customer terms .....

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..... mentioned as 'Insurance covered by us'. Hence department denied cenvat credit of outward freight on that particular customer transactions. Can we contest on this issue?. Besides, we are also charging Freight for some customers in the invoice. Is it necessary to include this amount also in assessable value? - Please provide your valuable opinion. Reply By Rama Krishana: The Reply: Cenvat crdit on .....

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..... outward freight beyond the place of removal is not allowed. Since your terms of agreement is FOR destination basis, it means, your place of removal is destination i.e customer's place. In such situation, department should not deny the benefit of credit. Since this is a question of fact and to seen that how insurance would be a bearing factor on the transaction, as such, and since the department h .....

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..... as denied the credit, you should take the matter with the authorities at appropriate level that you are fulfilling the conditions for availing the credit, credit should be allowed. Second part of the query is more relevant to determine the correctness of your claim of FOR delivery. In case of FOR delivery, in excise, you have to charge duty of excise on the value inclusive of freight. If you are n .....

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..... ot doing or no paying duty of excise on gross value including freight, you are contradicting your own facts and arguments that you are selling on FOR basis.
Discussion Forum - Knowledge Sharing .....

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